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2020 (3) TMI 112 - AT - Income TaxAdditions u/s 153A - no incriminating material found during the course of search by the searched team and the addition is not on the basis of any incriminating material, which has been challenged by the assessee by way of cross objections - HELD THAT:- There is no reference of any incriminating material on record. It has been observed by the CIT(A) that the additions made by the AO, has been recorded in the books of accounts, therefore, he deleted the addition as per Section 292C - it cannot be said that whatever the addition made by the AO was already recorded in the books of accounts. There is no any whisper in the assessment order that there was any undisclosed materials discovered by the search team. The assessee has filed return u/s.139(1) of the Act on 29.09.2009 and the search was took place on 16.01.2014 and 25.02.2014. therefore, it would be treated as unabated assessment as no assessment was pending before the AO. Therefore, without referring to any incriminating material found during the course of search, the addition cannot be made. CIT(A) relying upon the decisions of the Hon’ble High Court of Kerala in the case of E.N.Gopakumar Vs. CIT [2016 (11) TMI 72 - KERALA HIGH COURT] and case of CIT Vs. Raj Kumar Arora [2014 (10) TMI 255 - ALLAHABAD HIGH COURT] has held that even if there is no incriminating material, the AO is empowered to make additions in an assessment framed u/s.153A of the Act. We find that none of the decision relied upon by either of the parties are of jurisdictional High Court. It is a well settled position of law that when there are conflicting decisions of High Courts none of which is the jurisdictional High Court, then the decision favouring the assessee should be followed. For this, we derive support from the decision in the case of CIT vs. Vegetable Products Ltd. [1973 (1) TMI 1 - SUPREME COURT] - Assessment made u/s.153A of the Act for an assessment year for which assessment has not been abated and even no incriminating material found during the course of search, is unsustainable in the eyes of law. As per the decision of Hon’ble Delhi High Court in the case of Kabul Chawla, [2015 (9) TMI 80 - DELHI HIGH COURT] completed assessments can be interfered with by the Assessing Officer while making the assessment under section 153A of the Act only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in the course of original assessment. Undisputedly, in the instant case, the assessment for the assessment years in question have already been completed on the date of search and the AO has not referred to any incriminating material found during the course of search in the assessment order. Nothing is found contrary to the stated position of the assessee, therefore, the assessment framed u/s.153A is not sustainable - we quash the orders of both the authorities below and held that without referring any incriminating material by the AO in the assessment order for the years under consideration, stated to be unearthed during the course of search, framing the assessment under section 153A of the Act, is void ab initio. Thus, the legal ground raised by the assessee in both the cross objections is allowed.
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